(UPDATE: saw this on December 2. Maybe the mop up is not as simple as implied in my post)

A Dutch friend, trying one day to explain the reasons for canine biological deformities, coined the term ''overfucked''. That is, excessive in-breeding. The finer points of dog rearing are of little interest to me. But an apt turn of phrase, albeit crude, who doesn't appreciate those?

Anyway, the deeper public hands delve into public purses to buy or accept as collateral suspect assets, the more the Dutch explanation rings in my ears. Are financial markets becoming monetarily overfucked just ahead of massive electorally-promised fiscal stimuli? Are a convoy of inflationary 18-wheelers truly about to crush Lucky, our doggy economy?

A couple of fine links on the sterilization processes used by the US authorities may fill in the wonk lacking in this vulgar post. The answer is, as usual in the dismal science, that no one knows. The gold market, at least, does not yet appear alarmed and this, insofar as monetary policy is concerned, is a nod to history which shows that the artful timing of liquidity mop ups is hardly an impossible feat. The post-1987 period, for instance, is one regularly cited example of the Fed conducting an efficient and effective open-market mop up operation.

So it is probably not the operational skills of central bankers at stake - unless, perhaps, a large swathe of the assets and collateral the taxpayer has been exposed to becomes definitively impaired.

The unique historical US twists seem now to be the sheer scale of intervention, the implications of the nation's net debt position and the process by which the imminent President Obama New Deal II fiscal stimulus is monetized. This is not purely central banker domain. It is the beckoning, possibly, of a dominant period of economically volatile political horse trading.

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